The Price is Right? Pay Settlements and Nominal Wage Rigidity in Britain |
| |
| Authors: | Donna Brown Peter Ingram Jonathan Wadsworth |
| |
| Institution: | Royal Holloway College, University of London.; University of Surrey.; Centre for Economic Performance, London School of Economics, and Royal Holloway College, University of London. |
| |
| Abstract: | We examine representative, group‐level wage settlement data to augment the debate on nominal pay rigidity in Britain. We investigate the characteristics of groups that settle at zero and the role of within‐firm and external influences. Nominal settlement cuts are rare. Zero nominal wage settlements are more common, but still relatively unusual, highest during (low‐inflation) recessionary periods. Small groups, above all firms under duress, appear most likely to settle at zero. Once a group settles at zero it is unlikely to do so again in the short run. |
| |
| Keywords: | |
|
|
